Home news delivery (HND) giant NewsTeam Group (NTG) has made a strong return to profitability with great expectations for the year ahead.
The company’s soon to be released annual report for 2023, shared with Better Retailing, revealed a pre-tax profit of nearly £1.1m, compared to a £1.4m loss the year before. The results also reported a 15% revenue rise to £58.7m. The profit margin on its average delivery also rose from 8.6% to 14.5%.
The success was attributed to increases in its delivery prices, adding more drops per round with the help of improvements to HND tool PaperRound, and efficiency savings elsewhere in the business.
The firm said it was now the “largest news media distribution network in the country” and is now delivering to more than 80% of the UK.
Not only has the company reported its first profitable year since 2020, the trend looks set to continue. In the first three months of 2024 alone, the results show it has already made nearly as much pre-tax profits as it did in the whole of 2023. For the first time, the company also has no caveats to its ‘going concern status’, meaning it is no longer reliant on continued external investment.
EXCLUSIVE: NewsTeam Group to acquire PaperRound in management buy-out
Also for the first time, the company has been allowed to offset previous losses against its tax bills, which News Team Group highlighted as a sign of confidence from its auditor in the firm’s future.
NTG director Jon Kennett told RN: “It’s a vindication of our strategy, we always said that we needed to achieve scale and rapid growth to achieve the profitability we knew was possible, but this is the beginning of the middle, not the end of our journey. We’re confident that this year’s success will be even greater than our last.”
Following a management buy-out in late 2023, NTG is now owned by Cypriot parent company Suonal Ltd. The deal also saw Suonal Ltd acquire PaperRound.
NTG profitability timeline
- Jan-Dec 2022 – £117k average loss per month
- Jan-Aug 2023 – £63k average profit per month
- Sep-Dec 2023 – £150k average profit per month
- Jan-Mar 2024 – £333k average profit per month
The year ahead
The company’s strategy of acquiring rivals’ rounds, especially in areas adjacent or within where it already delivers, to is set to continue. This is fuelled by buying from ‘newsagents that wish to exit the category’. Aside from buying rounds, the company is looking to bolster its total drops by winning more corporate delivery contracts..
Since 2022, the company has been exploring delivering other products to customers, and the firm told RN it is now nearly ready to launch, with the first products ready to go, pending amends to its software to include non-news products, which are expected soon.
News Team Group is also looking to repeat its success in newspapers in magazines, where it is lobbying publishers to work with it, rather than just mail providers, to get copies of their editions to doorsteps.
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